(The Center Square) — New York lawmakers are expected to pass a fourth “extender” budget Thursday, with the state’s annual spending plan two weeks late amid behind-the-scenes negotiations over thorny policy issues.
Lawmakers blew past an April 1 deadline to approve the spending plan, and have enacted three interim budget bills to keep the government open as the talks continued. The most recent was approved on a voice vote Monday, which was intended to fund the state government through Thursday unless an agreement on the final spending plan is reached.
A sticking point in the closed-door negotiations appears to be tax policy, with a push among Democrats to give New York City Mayor Zohran Mamdani authority to raise more than $5 billion for New York City to help it reduce a budget deficit through a combination of higher taxes and increased state aid.
Democrats in the Assembly called for raising $2 billion by increasing tax rates on individuals who make more than $5 million a year, $1.9 billion from corporations and $95 million from a “crypto mining facility tax.” Senate Democrats want to raise $5.2 billion by pushing through a new income tax hike on the city’s top earners and eliminating tax breaks for climate polluters, among other changes.
Hochul, a Democrat who is running for reelection in November, released her roughly $260 billion preliminary executive budget in January but has rejected Mamdani’s calls for higher taxes as a “non-starter.”
This week, however, she changed course and rolled out a new plan to tax the second homes of wealthy New York City residents, which is being considered by legislative leaders.
Despite the proposed tax increases, Democratic legislative leaders are also pushing several “affordability” provisions in their version of the next state budget, such as a two-year moratorium on natural gas and electric rate hikes and utility “rebate” checks of up to $500 for the state’s energy consumers.
Lawmakers are also proposing a tax cut to low and middle-income New Yorkers earning below $323,200. The move would cost the state an estimated $2.1 billion in the next fiscal year, with the average $445 tax break.
But tardy budgets have become a common occurrence in Albany politics in recent years, drawing criticism from fiscal watchdogs and Republicans who constitute a minority in the state Legislature.
“The only thing Albany Democrats deliver on time: EXCUSES,” Senate Minority Leader Rob Ortt quipped on X. “They say missing budgets is “built into expectations.” Other lies: Just one more extender; we’re making progress; temporary taxes; ethics reform this session; showing up in person to vote.”
Last year, lawmakers approved a $254 billion budget that was nearly a month late. That spending was delayed by negotiations over reforms to the state’s pre-trial discovery laws, which set strict rules and deadlines on evidence sharing during criminal trials. A year before, lawmakers are more than a month late approving a budget.
“Disappointment continues, as the New York State budget is late for the 7th consecutive year. This lateness habit is unacceptable,” Andrew Rein, president of the nonpartisan Citizens Budget Commission, said in a statement. “That the Legislature is on recess during this critical moment is a bit of a head-scratcher. How many organizations would schedule a break when they’ve missed the same critical deadline for the past six years?”
Rein said state leaders “should focus on enacting a smart, future-proofing budget — one that focuses on affordability and program quality, curbs ballooning spending growth, and holds the line on New York’s nation-leading taxes.”
“New Yorkers are largely at work right now,” he said. “They pay and elect their leaders to use their dollars wisely. Lawmakers should be on the job and enact a budget.”
